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What Happened to Privacy Coins?
Privacy coins have lost 44.3% market share to privacy blockchains since 2021, based on monthly average token market capitalization of leading crypto privacy assets. Privacy coins previously accounted for a dominant 96.6% share of the crypto privacy market in January 2021 (at a $4.62 billion market capitalization), but now holds just 52.3% as of February 2024 ($3.08 billion). In contrast, the market share of privacy blockchains has grown by 14 times, from 3.4% ($0.16 billion market capitalization) to 47.7% ($2.81 billion).
This points to the ongoing advancements in crypto privacy: From pioneering privacy coins modeled after Bitcoin and built to function primarily as currencies, to next-generation privacy blockchains built as a broader ecosystem with smart contract capabilities and regulatory considerations.
Among the top three privacy coins examined, Dash (DASH) lost the most market share of 17.1%, after its market share fell from 22.7% in January 2021 to 5.6% in February 2024. Over the same period, the market share of Zcash (ZEC) shrank from 19.1% to 5.8% (-13.3%), while Monero (XMR) experienced a relatively smaller market share decline of 54.8% to 40.9% (-13.9%).
Meanwhile, privacy blockchains recorded market share increases of 11.9% for Oasis Network (ROSE), 0.6% for Secret Network (SCRT) and 1.9% for Dusk Network (DUSK). Three more privacy blockchains came onto market during this period: Mina Protocol (MINA) saw 18.4% growth in market share and Aleph Zero (AZERO) added 3.9% share, compared to when their tokens started trading. Iron Fish (IRON) is the only privacy blockchain that lost market share since launch (-1.7%).
Privacy Coins Plagued by Concerns Over Misuse
Privacy coins emerged around 2014 with launches including Monero and Dash, gaining popularity among the crypto community of early adopters, who were more aligned to ideologies such as rights to privacy and anonymity. However, the popularity of privacy coins has declined since then, fueled by regulatory scrutiny over illegal or illicit activities, and the changing demographics of crypto users.
Over the years, privacy coins have been hit by periodic delistings from centralized crypto exchanges – for example, Upbit in 2019, Bittrex and Coincheck in 2021, Huobi (or HTX) in 2022, as well as OKX and Binance’s Europe operations in 2023. Other key headwinds include the US sanctions against crypto mixer Tornado Cash in August 2022, and the European Union’s upcoming stricter Anti-Money Laundering Regulation (AMLR).
Most recently, XMR’s market share decreased by 5.3% month-on-month in February 2024, after Binance announced that it would also be delisted from its wider platform. That said, exchange delistings have generally impacted privacy coins’ market share and market capitalization on a cumulative, long-term basis, rather than immediate.
What Are the Top Privacy Blockchains?
The top 3 privacy blockchains are Mina Protocol (23.2% market share), Oasis Network (13.6%) and Aleph Zero (6.1%), which have all overtaken Zcash and Dash in terms of market capitalization. Privacy blockchains first emerged around 2021, against a backdrop of mounting regulatory issues faced by privacy coins.
Mina Protocol is currently the biggest privacy blockchain by market capitalization at $1.36 billion, which is over half of Monero’s $2.41 billion. In comparison, XMR was at $4.51 billion (54.9% market share) when MINA started trading at a $0.39 billion market capitalization (4.7% share) in June 2021. The project saw particularly rapid growth in the last few months, with its market share jumping from 10.1% in October 2023, to 23.2% in February 2024.
The second biggest privacy blockchain is Oasis Network with $0.80 billion in market capitalization, representing a 10 times growth from its $77.62 million market cap in January 2021. Oasis’ market share surged from 2.9% in January 2021, to a high of 13.6% in January 2022. While Oasis Network was unable to hold onto its gains over the next two years, it managed to recover this year, with market share increasing from 6.7% in November 2023 to 13.6% in February 2024.
Aleph Zero ranks as the third largest privacy blockchain with a 6.1% share of the crypto privacy market, driven by steady growth that cemented its position in the top 3 since August 2022. The market capitalization of AZERO has risen to $360.78 million in February 2024 (+153.7%), as compared to the $234.70 million market capitalization when it started trading in January 2022. Aleph Zero first overtook Zcash in market share in May 2023, then caught up to Dash last November.
The remaining privacy blockchains with the smallest market shares are Dusk Network (2.3%), Secret Network (1.9%) and Iron Fish (0.6%). Dusk Network has seen its market share fluctuate below 2.0% from 2021 to date and has yet to break above its 2.8% share high during this period. Secret’s market share peaked at 11.1% in February 2022 and has hovered below 2.0% since June 2023. Meanwhile, Iron Fish has only seen a downtrend after it launched at 2.3% in market share.
The top privacy blockchains have grown by 1,650.6% in the last three years, based on a combined market capitalization increase from $0.16 billion at the start of 2021, to $2.81 billion in February 2024.
Market Share of Top Privacy Coins & Blockchains
The market shares of top privacy coins and privacy blockchains, based on market capitalization as of February 2024:
| Privacy Coin or Blockchain | Market Share |
|---|---|
| Monero | 40.9% |
| Mina Protocol | 23.1% |
| Oasis Network | 13.6% |
| Aleph Zero | 6.1% |
| Dash | 5.8% |
| Zcash | 5.6% |
| Dusk Network | 2.3% |
| Secret Network | 2.0% |
| Iron Fish | 0.6% |
Methodology
The study examined the monthly average market capitalization of 8 privacy-related crypto assets, based on CoinGecko data from January 1, 2021 to February 26, 2024. Aleph Zero’s AZERO circulating supply was supplemented with data provided by the team. Iron Fish’s IRON circulating supply was assumed to be their self-reported number of 20,023,660 (taken on February 14, 2024), as additional data was unavailable. Project or network names were used interchangeably with asset tickers for simplicity.
For the purpose of this study, ‘privacy coins’ were defined as the pioneering generation of crypto assets that offer privacy to users; ‘privacy blockchains’ or ‘privacy-enhancing blockchains’ were defined as the latest generation of privacy-focused crypto assets with smart contract capabilities and regulatory compliance considerations, among other differentiation factors. Project selection also took into consideration factors including relative market capitalization, trading volume and brand recognition. Projects that no longer focused on privacy were excluded from the study, including but not limited to Horizen.
This study is for illustrative and informational purposes only, and is not financial advice. Always do your own research and be careful when putting your money into any crypto or financial asset.
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Curious to find out more about our previous research studies & statistics? Check out this one we did about countries where crypto is legal.
Yuqian is a cryptocurrency writer and marketer who specializes in mainstream cryptocurrency insights. She's especially fascinated by the philosophical and socioeconomic aspects of crypto and also goes by the name of Q. She holds a Bachelor of Social Sciences with Honors from the National University of Singapore. Follow the author on Twitter @solosbrqt
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